The US has asked for the EU to pause its planned deforestation law, set to come into effect at the end of this year.
According to a letter seen by the FT, the White House has urged Brussels to delay the regulation on deforestation and supply chains, on the basis that it will hurt North American companies.
The US secretaries for commerce and agriculture, Gina Raimondo and Thomas Vilsack, and trade envoy Katherine Tai, argued that the deforestation law posed “critical challenges” to US producers.
“We therefore urge the European Commission to delay the implementation of this regulation and subsequent enforcement of penalties until these substantial challenges have been addressed,” they said in the letter, dated 30 May.
In response, the EU said it had received the letter and would reply “in due course”.
Law explained
The law aims to ban products that contribute to deforestation from being imported into Europe.
It was unveiled in June 2023. From 30 December 2024, companies will need to confirm that any product exported to or sold in the EU is ‘deforestation free’.
Small businesses have until 30 June 2025 and benefit from simplified obligations.
According to the European Commission (EC), firms dealing with goods like palm oil, coffee or cocoa will have to confirm they have been produced on land that is not subject to deforestation.
No specific products have been banned and no countries have been targeted, as of yet. However, the American Forest and Paper Association have said it would be “impossible” to comply because paper and pulp is often a mix of different wood products.
Controversy
The law has provoked debate elsewhere, as trade partners across the world have raised objections.
Many Amazon nations also are uneasy about the laws.
The Amazon Cooperation Treaty Organisation – formed of Brazil, Bolivia, Colombia, Ecuador, Guyana, Peru, Suriname and Venezuela – released the Belém Declaration last year, attacking “unilateral trade measures” that would allegedly hit smaller farmers and harm efforts to eliminate food hunger.
Indonesia and Malaysia are both critical of the law. The palm oil-exporting nations have echoed the criticisms that it will predominantly hit smaller companies.
“[The EU] deforestation law, for a big company, it’s very easy to comply. The issue will be for the smallholders,” Indonesian economic minister Airlangga Hartarto told Euractiv.
Both countries have filed complaints with the WTO, although the EU was largely successful in defending itself against Malaysia’s claim and Indonesia suspended its complaint before a ruling could come out.
‘Acting without delay’
The EC has defended the regulations as being necessary in the fight against climate change.
EC environmental commissioner Virginijus Sinkevičius said that there was a “need to act without delay” to reverse the “alarming trends” of climate change and biodiversity loss.
The regulation was also welcomed by environmental groups, with the WWF saying that the EU could become a “force for good” and turn the tide.